Finance Course Description

Finance: Understanding Financial Principles and Practices

This course provides a comprehensive introduction to the core principles of finance, equipping students with the knowledge and skills necessary to understand and analyze financial decisions made by individuals, corporations, and institutions. Through a blend of theoretical frameworks and practical applications, students will develop a strong foundation for further study in finance or for applying financial concepts in their professional lives.

Course Objectives:

• Understand the fundamental concepts of time value of money and its applications in investment decisions.
• Analyze financial statements and assess the financial health of a company.
• Evaluate investment opportunities using various valuation techniques, including discounted cash flow analysis.
• Learn about different types of financial markets and instruments, including stocks, bonds, and derivatives.
• Comprehend the principles of risk and return and apply them to portfolio management.
• Understand the capital budgeting process and make informed investment decisions for corporations.
• Explore corporate finance topics such as capital structure, dividend policy, and mergers and acquisitions.
• Develop ethical awareness in financial decision-making.

Course Content:

The course will cover the following key topics:

* Introduction to Finance: Overview of the financial system, financial institutions, and the role of finance in the economy. * Time Value of Money: Present value, future value, annuities, perpetuities, and their applications in financial planning and investment analysis. * Financial Statement Analysis: Understanding the balance sheet, income statement, and statement of cash flows; ratio analysis for assessing profitability, liquidity, solvency, and efficiency. * Valuation of Securities: Equity valuation models, bond valuation models, and factors affecting security prices. * Risk and Return: Measuring risk, diversification, the Capital Asset Pricing Model (CAPM), and the efficient market hypothesis. * Capital Budgeting: Net present value (NPV), internal rate of return (IRR), payback period, and other capital budgeting techniques. * Corporate Finance: Capital structure decisions, dividend policy, working capital management, and mergers and acquisitions. * Financial Markets and Institutions: Overview of different types of financial markets, including money markets, capital markets, and derivatives markets. Role of financial intermediaries and regulatory bodies. * Investment Management: Portfolio construction, asset allocation, performance evaluation, and ethical considerations in investment management.

Assessment:

Student learning will be assessed through a combination of the following:

* Exams: Midterm and final exams covering the core concepts and problem-solving techniques. * Quizzes: Regular quizzes to assess understanding of the material covered in each module. * Assignments: Problem sets and case studies applying financial concepts to real-world scenarios. * Project: A group project involving financial analysis of a company or investment opportunity. * Class Participation: Active engagement in class discussions and problem-solving exercises.

Prerequisites:

A basic understanding of algebra and accounting principles is recommended. No prior knowledge of finance is required.

This course is ideal for students pursuing degrees in business, economics, engineering, or any field where financial literacy is important. It also benefits individuals seeking to improve their personal financial management skills and make informed investment decisions.